NNPC Lacks Funds to Replace Aging Pipelines, Says FG
The Federal Government of Nigeria has revealed that the Nigerian National Petroleum Company Limited (NNPC) does not have the necessary funds to rebuild the country’s aging oil pipelines. Speaking at the Energy and Labour Summit 2024 in Abuja, Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, highlighted the critical need for public-private partnerships (PPP) to address the deteriorating infrastructure.
Lokpobiri emphasized that many of Nigeria’s pipelines, built in the 1960s and 1970s, have long exceeded their lifespan, leading to frequent vandalism and significant challenges in evacuating crude oil to terminals. He noted that the NNPC lacks the financial resources to replace these pipelines, making PPPs essential for revitalizing the country’s oil infrastructure.
The minister also touched on the smuggling of fuel from Nigeria to neighboring countries, attributing it to the NNPC’s practice of importing and selling fuel below the landing cost, which incentivizes smuggling activities.
Lokpobiri expressed concern that unless oil production is ramped up, Nigeria may struggle to meet its obligations to supply crude to local refineries, including the Dangote Refinery. He underscored the importance of supporting local refining to ensure both domestic supply and export capacity.
The minister reaffirmed the government’s commitment to creating a competitive environment for both small and large refiners, ensuring fair treatment across the industry.
